GlaxoSmithKline plc, one of the world’s leading research-based pharmaceutical and healthcare companies, announced the completion of its transaction to divest its rights to ofatumumab for auto-immune indications to Novartis Pharma AG (Novartis Pharma), a subsidiary of Novartis AG, following regulatory approval.

The consideration payable by Novartis Pharma to GSK may reach up to $1,034 million and comprises a series of milestone payments as follows: $300 million paid at closing; $200 million payable subject to the start of a phase III study in relapsing remitting multiple sclerosis by Novartis; further contingent payments of up to $534 million payable on the achievement of certain other development milestones.

Novartis Pharma will also pay royalties of up to 12 per cent to GSK on any future net sales of ofatumumab in auto-immune indications.

Income generated from the divestment will be treated as non-core in line with the accounting policies outlined in the third quarter financial results announcement of October 28, 2015.